2019 Spring Budget: Key announcements

Update on the overall health of the economy

The Spring Statement is an opportunity for the Chancellor to provide an update on the overall health of the economy and the Office for Budget Responsibility’s (OBR) forecasts for growth and the public finances.

It is also an opportunity to update on the progress made since Budget 2018, and to launch consultations on possible future changes for the public and business to comment on. The Spring Statement doesn’t include major tax or spending changes – these are made once a year at the Budget.

2019 Spring Budget: Key Announcements

Key announcements from the Chancellor at a glance

Philip Hammond, the Chancellor of the Exchequer, described the economy as “remarkably robust” and added that it has “defied expectations”, pointing to improvements in government finances, wage growth and “on target” inflation levels. These are the key takeaways from Spring Statement 2019.

Growth
  • Forecast of 1.2% growth for 2019
  • Then 1.4% in 2020, 1.6% in 2021, 2022 and 2023
  • In October, growth was forecast at 1.6% for 2019, 1.4% for 2020, 1.4% in 2021, 1.5% in 2022 and 1.6% in 2023
Growth
  • Forecast of 1.2% growth for 2019
  • Then 1.4% in 2020, 1.6% in 2021, 2022 and 2023
  • In October, growth was forecast at 1.6% for 2019, 1.4% for 2020, 1.4% in 2021, 1.5% in 2022 and 1.6% in 2023
Borrowing
  • Forecast for borrowing to be £3bn lower in 2018/19 than forecast at the Autumn Budget
  • Borrowing forecast to be £29.3bn in 2019/20, then £21.2bn in 2020/21, £17.6bn in 2021/22, £14.4bn in 2022/23 and £13.5bn in 2023/24
  • In October, borrowing was forecast to be £25.5bn in 2018/19, then £31.8bn in 2019/20, £26.7bn in 2020/21, £23.8bn in 2021/22, £20.8bn in 2022/23 and £19.8bn in 2023/24
Debt
  • Debt is forecast to be 82.2% as a share of GDP in 2019/20
  • Debt as a share of GDP is forecast to fall to 79% in 2020/21, 74.9% in 2021/22, 74% in 2022/23 and finally 73% in 2023/24
Brexit
  • Direct message issued to parliament that building a stronger country was only possible by avoiding no-deal Brexit
  • £15.4bn headroom in the public finances that could be used in a no-deal Brexit increased to £26.6bn
  • No-deal Brexit would cause the economy to be smaller and weaker in future, leading to higher prices for consumers
  • No-deal Brexit would mean a ‘short to medium-term reduction in the productive capacity of the economy’
  • Tax and spending responses and Bank of England policy changes could only ever be temporary to handle a no-deal Brexit, to avoid higher levels of inflation
Spending Review
  • Treasury will conduct a full spending review before the summer recess, to be concluded before the Autumn Budget
  • There will be a ‘deal dividend’ from lifting business uncertainty, encouraging firms to invest. Government able to spend some of the money left in reserve for a no-deal scenario
Global Britain
  • From June the government will begin to abolish the need for paper landing cards at UK points of entry, including airports and Eurostar terminals, for countries including the US, Australia, Canada, South Korea and Japan
  • PhD level roles will be completely exempt from visa caps
Housing
  • £3bn in funding announced to help deliver 30,000 affordable homes
  • £ 1bn for small and medium-sized builders of homes
  • £ 117m from the housing infrastructure fund to unlock up to 37,000 new homes in Cheshire, London, Didcot and Cambridge
Productivity
  • Capital budgets set to protect ‘record levels’ of spending, while ensuring this will boost productivity
  • Government aims to ‘slay once and for all the twin demons of low productivity and low wages and build an economy that works for everyone’
Technology
  • Investment packages for laser technology and nuclear research
  • Funding for a new supercomputer at Edinburgh University
Technology Companies
  • Government will make technology companies ‘pay their fair share’ and protect consumers from online harm
  • ‘This government will lead the world in delivering a digital economy that works for everyone’
Environment
  • ‘Future homes standard’ announced to mandate the end of fossil-fuel heating systems in all new houses from 2025
  • Comprehensive review of the link between biodiversity and the economy by Professor Partha Dasgupta from Cambridge University
  • Additional £100m to be made available immediately over the course of the next year, ring-fenced to pay for extra police overtime targeted specifically at knife crime
  • Free sanitary products available in secondary schools in England from the next school year

Plan for the life you want

If you would like to discuss any of the announcements made during the Spring Statement 2019 and what their implications could mean to you, your family and your business, please Contact Us. We look forward to hearing from you.

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The content of this Spring Statement 2019 summary was produced on 13 March 2019 and is for your general information and use only and is not intended to address your particular requirements. The content should not be relied upon in its entirety and shall not be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of the content. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts. Levels and bases of, and reliefs from, taxation are subject to change and their value depends on an individual’s personal circumstances.

Content of the articles featured is for general information and use only and is not intended to address an individual or company’s particular requirements or be deemed to be, or constitute, advice. Although endeavours have been made to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No individual or company should act upon such information without receiving appropriate professional advice after a thorough examination of their particular situation. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of any articles. Thresholds, percentage rates and tax legislation may change in subsequent Finance Acts.